Faqs Page BG

Frequently Asked Questions (FAQs)

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Demat/Depository
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  • Who is a DP?

    A Depository like NSDL (National Securities Depository Limited) or CDSL (Central Depository Services Limited) provides its services to investors through its agents called Depository Participants (DPs). These agents are appointed by NSDL & CDSL with the approval of SEBI. According to SEBI regulations, amongst others, three categories of entities i.e. Banks, Financial Institutions and Members of Stock Exchanges registered with SEBI (brokers) can become DPs. You can get a list of DPs from NSDL's or CDSL's office.

    Our Bank has now centralised DP operations (both for CDSL as well as NSDL) besides existing DPs, which are being planned to be migrated to central set-up in a phased manner. The Central Back-Office DP Operations (CBODPO) is at UTI Tower, Bandra Kurla Complex, Mumbai.

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  • Am I restricted to having account with only one DP?

    No. There are no restrictions on the number of DPs you can open accounts with or the number of accounts you can open with a DP. Depository accounts are similar to bank accounts. Just as you can have savings or current accounts with more than one bank, you can open accounts with more than one DP.

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  • Can I change the details of my bank account?

    Yes. Since in the depository system monetary benefits on your security balances are paid as per the bank account details provided by you at the time of account opening, you must ensure that any subsequent change in bank account details is informed to your depository participant.

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  • Can I open a single account for securities owned in different ownership patterns such as securities owned individually and securities owned along with my wife?

    No. The demat account must be opened in the same ownership pattern in which the securities are held in the physical form. E.g.: if one share-certificate is in your individual name and another certificate is jointly held in your and your wife's name, two different accounts would have to be opened.

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  • Can I open more than one account with the same DP?

    Yes. You can open more than one account with the same DP. There is no restriction on the number of accounts you can open with a DP.

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  • How do I select a DP? Whether all DPs are same?

    You can select your DP to open a demat account just like you select a bank for opening a savings account. Some of the important factors for the selection of a DP can be:

    Convenience: Proximity to the office/residence, business hours.

    Comfort:Reputation of the DP, past association with the organisation, whether the DP is in a position to give the specific service you may need.

    Cost: The service charges levied by DP and the service standards-

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  • What do I do if I have physical certificates with the same combination of names, but the sequence of names is different i.e. some certificates with husband as first holder and wife as second holder and other set of certificates with wife as first holder and husband as the second holder (For example changed from A & B to husband & wife)?

    In this case, you may open only one account with husband and wife as the account holders and lodge the security certificates with different order of names for dematerialisation in the same account. You will fill up an additional form called the "Transposition cum Demat" form. This would help you to effect change in the order of names as well as dematerialise the securities.

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  • What should I do when I want to open an account with a DP?

    You can approach any DP of your choice and fill up an account opening form. At the time of opening an account, you have to sign an agreement with DP in an NSDL prescribed standard agreement, which details your and your DP’s rights and duties. All investors have to submit the following proof of identity and proof of addresses along with the prescribed account opening form.

    Proof of Identity:Your signature and photograph must be authenticated by an existing demat account holder with the same DP or by your bank. Alternatively, you can submit a copy of your Passport, Voters ID Card, Driving License or PAN Card with photograph.

    Proof of Address:You can submit a copy of your Passport, Voters ID Card, Driving License or PAN Card with photograph, ration card or bank passbook as proof of address.

    Passport-size photograph: You must remember to take original documents to the DP for verification.

    You should remember to obtain a copy of the agreement and schedule of charges for your future reference.

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  • Why should I give my bank account details at the time of account opening?

    It is for the protection of your interest. Your bank account number will be mentioned on the interest or dividend warrant you are entitled to so that such warrant cannot be encashed by anyone else. Further, a DP cannot open the account if the bank account number is not given.

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  • What is 'standing instruction' given in the account opening form?

    In a bank account, credit to the account is given only when a 'paying in' slip is submitted together with cash/cheque. Similarly, in a depository account 'receipt in' form has to be submitted to receive securities in the account. However, for the convenience of the investors, the facility of 'standing instruction' is given. If you say 'yes' (or tick) for standing instruction, you need not submit a 'receipt in' slip every time you buy securities.

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  • Can I close my demat account with one DP and transfer all securities to my account with another DP?

    Yes. You can submit an account closure request to your DP in a prescribed form. Your DP will transfer all your securities, as per your instruction, and close your demat account.

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  • Can I operate a joint account on an ‘either or survivor’ basis just like a bank account?

    No. The demat account cannot be operated on an ‘either or survivor’ basis like the bank account.

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  • Is it compulsory for every investor to open a depository account to trade in the capital market?

    Since 99.5 % of the settlement at the stock exchanges is taking place in the demat form, an investor buying securities would receive the securities in demat form only. Therefore, investors who actively buy and sell securities need to open a depository account to receive delivery of demat securities.

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  • What should I do if my address is changed? Do I need to write to each company separately?

    In case your address is changed, you only need to inform the new address to your DP(s). When DP enters the new address in the depository computer system, it will be automatically conveyed to all companies in which you hold shares.

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  • What are the benefits of a depository?

    The benefits of participation in a depository are:

    Immediate transfer of securities;

    No stamp duty on transfer of securities;

    • Elimination of risks associated with physical certificates such as bad delivery, fake securities, etc.
    • Reduction in paperwork involved in the transfer of securities;
    • Reduction in transaction cost;
    • Nomination facility;
    • Facility to pledge the securities.
    • Facility of trading in odd lots.

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  • What will be the charges for account opening and other depository-related transactions?

    NSDL charges the DPs and not the investors. NSDL's charges to its DPs are fixed. However, the DP is free to charge its client for the services offered. The charges that DP will be charging you for various services are mentioned in the schedule of charges, which forms a part of the account opening agreement. You may keep a copy of this for your future reference. You can get the details of the charges from the DPs. You can also get a comparative list of DP charges from NSDL's office or the NSDL website.

    Your DP may change charges by giving you 30 days’ notice in advance notice.

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  • What would be the charges for account closure and securities transfer due to account closing?

    The charges would be as per the schedule of charges agreed by you at the time of account opening or any subsequent changes therein.

    NSDL is allowing waiver of charges to DPs where all the securities in an account are moved to another account with another DP due to account closure, if account name remains the same. NSDL allows waiver of its charges for cases where NSDL charges to the DP are more than Rs. 100. Your DP may pass on this benefit to you.

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  • What is a depository?

    A depository can be compared to a bank. A depository holds securities (like shares, debentures, bonds, Government Securities, units, etc.) of investors in electronic form. Besides holding securities, a depository also provides services related to transactions in securities.

    Bank depository: An Analogy

    .
    Bank Depository
    Holds funds in an account Holds securities in an account
    Transfers funds between accounts on the instruction of the account holder Transfers securities between accounts on the instruction of the account holder....
    Facilitates transfer without having to handle money Facilitates transfer of ownership without having to handle securities
    Facilitates safekeeping of money Facilitates safekeeping of securities

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  • How can one avail the service of a depository?

    A depository interface with the investors through its agents called Depository Participants (DPs). If an investor wants to avail the services offered by the depository, the investor has to open an account with a DP. This is similar to opening an account with any branch of a bank in order to utilise the bank's services.

    Our Bank has now centralised DP operations (both for CDSL as well as NSDL) besides existing DPs, which are being planned to be migrated to central set-up in a phased manner. The central back-office DP Operations (CBODPO) is at UTI Tower, Bandra Kurla Complex, Mumbai.

    Our Identified CBS Branches can now open & operate demat accounts, if they are linked to Central Back Office DP Operations (CBODPO) of the Bank situated at UTI Tower, Bandra Kurla Complex, Bandra (East), Mumbai

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  • What are the facilities offered by a depository?

    A depository offers the following facilities:

    • Rematerialisation i.e., conversion of securities in demat form into physical certificates;
    • Electronic settlement of trades in stock exchanges connected to the depository.
    • Pledging/hypothecation of dematerialised securities against bank loan;
    • Electronic credit of securities allotted in public issues, rights issue;
    • Receipt of non-cash corporate benefits such as bonus in electronic form;
    • Freezing of demat accounts, so that the debits from the account are not permitted;
    • Nomination facility for demat accounts;
    • Services related to change of address;
    • Effecting transmission of securities;
    • Account monitoring facility through Internet (CDSL: Easy; NSDL: Speed-e).
    • Submission of delivery instructions through Internet ("Easiest" of CDSL and "Speede" of NSDL)
    • Other facilities viz. holding debt instruments in the same account, availing stock lending/borrowing facility, etc.

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  • Who is a Non-Resident Indian NRI

    An Indian citizen who stays abroad for employment/carrying on business or vocation outside India, or stays abroad under circumstances indicating an intention for an uncertain duration of stay abroad is a non-resident. (Persons posted in the UN organisations and officials deputed abroad by Central/State Governments and Public Sector undertakings on temporary assignments are also treated as non-residents). Non-resident foreign citizens of Indian origin are treated on par with non-resident Indian citizens (NRIs).

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  • Who is a person of Indian origin?

    For the purposes of availing the facilities of opening and maintenance of bank accounts and investments in shares/securities in India:

    A foreign citizen (other than a citizen of Pakistan or Bangladesh) is deemed to be of Indian origin, if,

    • he/she, at any time, held an Indian passport; or
    • he/she or either of her/his parents, or grandparents. were a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955; or
    • Note: A spouse (not being a citizen of Pakistan or Bangladesh) of an Indian citizen, or of a person of Indian origin is also treated as a person of Indian origin for the above purposes, provided the bank accounts are opened or investments in shares/securities in India are made by such persons only jointly with their NRI spouses.
    • For investments in immovable properties. A Foreign citizen (other than a citizen of Pakistan, Bangladesh, Afghanistan, Bhutan, Sri Lanka or Nepal), is deemed to be of Indian origin if,
    • he/she, at any time, held an Indian passport; or
    • OR

    • his/her father or parental grandfather was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955).

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  • What is an OCB?

    Overseas Corporate Bodies (OCBs) are bodies predominantly owned by individuals of Indian Origin, or nationality resident outside India and include overseas companies, partnership firms, societies and other corporate bodies which are owned, directly or indirectly, to the extent of at least 60% by individuals of Indian nationality, or origin resident outside India as also overseas trusts in which at least 60% of the beneficial interest is irrevocably held by such persons. Such ownership interest should be actually held by them, and not in the capacity as nominees. The various facilities granted to NRIs are also available with certain exceptions to OCBs so long as the ownership/beneficial interest held in them by NRIs continues to be at least 60%.

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  • Are OCBs required to produce any certificate regarding ownership/beneficial interest in them by NRIs?

    Yes. In order to establish that the ownership/beneficial interest in any OCB held by NRIs is not less than 60%, the concerned body/trust is required to furnish a certificate from an overseas auditor/chartered accountant/certified public accountant in form OAC, where the ownership/beneficial interest is directly held by NRIs and further that such ownership interest is actually held by them and not in the capacity as nominees.

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  • What are the various facilities available to NRIs/OCBs?

    NRIs/OCBs are granted the following facilities:

    • Maintenance of bank accounts in India
    • Investments in securities/shares of, and deposits with, Indian firms/companies.
    • Investments in immovable properties in India.

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  • Can I pledge dematerialised securities?

    Yes. In fact, pledging dematerialised securities is easier and more advantageous as compared to pledging physical securities.

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  • What should I do if I want to pledge electronic securities?

    The procedure is as follows:

    • Both you (pledgor) and the lender (pledgee) must have depository accounts;
    • You have to initiate the pledge by submitting to your DP the details of the securities to be pledged in a standard format;
    • The pledgee has to confirm the request through his DP;
    • Once this is done, your securities are pledged
    • All financial transactions between the pledgor and the pledgee are handled as per usual practice outside the depository system.

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  • How can I close the pledge after repayment of my loan?

    After you have repaid your loan, you can request for a closure of the pledge by instructing your DP in a prescribed format. The pledgee, on receiving the repayment, will instruct his DP accordingly for the closure of the pledge.

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  • Whether pledgee account can be in a different DP?

    Yes. The pledgee can have an account with a different depository participant of NSDL.

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